Rhonda was employed by Midwest Bank of North Carolina to represent it. Midwest d

Question

Rhonda was employed by Midwest Bank of North Carolina to represent it. Midwest discussed the possibility of Rhonda working as in-house counsel for Midwest to handle recovery and bankruptcy cases. On her employment application, Rhonda disclosed that she had been convicted of 2 misdemeanor larceny. Those convictions made it unlawful for her to become an employee of Midwest without FDIC approval. Midwest proceeded with its working relationship with Rhonda, who closed her private practice and moved on site with Midwest.The parties executed a written contract under which Rhonda would provide legal services as an independent contractor. Both parties intended that Rhonda would not be considered an employee unless the FDIC waiver was obtained. Such a waiver was never sought for Rhonda. Rhonda was considered an independent contractor for tax purposes and was never paid a salary by Midwest but, instead, was paid for the bills she submitted. She received no benefits or compensation for business travel. She used letterhead that designated her simply as an attorney-at-law and did not rreceive business cards. However, she was provided with on-site office space, support, staff, equipment, and the use of company vehicles. She was paid for continuing education. Midwest exercised control over the hours in which she had access to her office.
After complaining about a sexually and racially hostile work environment. Rhonda was terminated. She filed several claims under Title VII. Was Midwest Rhonda's employer? Why or Why not?

Explanation / Answer

Yes. Simply calling someone an independent contractor does not make it so. By paying her bills and providing her with the tools/supplies to do her job, they are demonstrating employee status. Most importantly, they are demonstrating substantial control over her. Even though she did not have FDIC approval, that is irrelevant to her actual status. It is the employers job "to avoid hiring or permitting participation in its affairs by a person who has a conviction or program entry for a covered offense" (from FDICA) and by hiring her they are potentially in violation of this act.

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